Principal Financial Group said Thursday that it plans to exit the medical insurance business, resulting in some job cuts.

Company officials said that as the company makes the change, positions will be eliminated. There are around 1,500 employees in the company's medical insurance area. Officials said they hope to move some employees into open positions and fill other positions through attrition.

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Some 650 positions are affected in the Des Moines area, company officials said.

Immediate cuts of around 150 jobs are expected as some functions are cease more quickly, officials said.

Affected employees will be considered for other positions and will be given severance and outplacement assistance if they are unable to find a position within the company.

Principal said it has entered into an agreement with UnitedHealthcare to renew medical insurance coverage for customers of The Principal as the business transitions out of the business within the next 36 months.

Company officials said the decision does not impact their other businesses including retirement, asset management, life insurance, wellness, disability, dental and vision.

"While a difficult decision, this is the right strategic decision for The Principal. While performing well financially, our medical business has been declining in relative size for a number of years, thanks to strong growth from our retirement and asset management businesses. The medical business continues to be one that undergoes rapid change, which would mean investing additional capital into the business to be able to offer competitive products. For us, that just does not make sense," said Larry Zimpleman, Principal's chairman, president and chief executive officer.

Sales will cease and the renewal process with UnitedHealthcare will begin immediately to be completed within 36 months, subject to applicable requirements of federal and state law, the company said.

"By making this decision, we are positioned to focus our capital and our resources on the strategic opportunities in the asset accumulation and asset management businesses, both domestically and internationally," Zimpleman said. "And it allows us to continue the growth in our risk businesses, which is important to our overall diversification as well as maintaining our leadership among small- and medium-sized businesses."